Trump plan to avoid business conflicts of interest doesn't fly

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Photos:Donald Trump's rise

President-elect Donald Trump has been in the spotlight for years. From developing real estate and producing and starring in TV shows, he became a celebrity long before winning the White House.

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Photos:Donald Trump's rise

Trump at age 4. He was born in 1946 to Fred and Mary Trump in New York City. His father was a real estate developer.

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Photos:Donald Trump's rise

Trump, left, in a family photo. He was the second-youngest of five children.

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Photos:Donald Trump's rise

Trump, center, stands at attention during his senior year at the New York Military Academy in 1964.

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Photos:Donald Trump's rise

Trump, center, wears a baseball uniform at the New York Military Academy in 1964. After he graduated from the boarding school, he went to college. He started at Fordham University before transferring and later graduating from the Wharton School, the University of Pennsylvania's business school.

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Photos:Donald Trump's rise

Trump stands with Alfred Eisenpreis, New York's economic development administrator, in 1976 while they look at a sketch of a new 1,400-room renovation project of the Commodore Hotel. After graduating college in 1968, Trump worked with his father on developments in Queens and Brooklyn before purchasing or building multiple properties in New York and Atlantic City, New Jersey. Those properties included Trump Tower in New York and Trump Plaza and multiple casinos in Atlantic City.

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Photos:Donald Trump's rise

Trump attends an event to mark the start of construction of the New York Convention Center in 1979.

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Photos:Donald Trump's rise

Trump wears a hard hat at the Trump Tower construction site in New York in 1980.

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Photos:Donald Trump's rise

Trump was married to Ivana Zelnicek Trump from 1977 to 1990, when they divorced. They had three children together: Donald Jr., Ivanka and Eric.

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Photos:Donald Trump's rise

The Trump family, circa 1986.

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Photos:Donald Trump's rise

Trump uses his personal helicopter to get around New York in 1987.

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Photos:Donald Trump's rise

Trump stands in the atrium of the Trump Tower.

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Photos:Donald Trump's rise

Trump attends the opening of his new Atlantic City casino, the Taj Mahal, in 1989.

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Photos:Donald Trump's rise

Trump signs his second book, "Trump: Surviving at the Top," in 1990. Trump has published at least 16 other books, including "The Art of the Deal" and "The America We Deserve."

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Photos:Donald Trump's rise

Trump and singer Michael Jackson pose for a photo before traveling to visit Ryan White, a young child with AIDS, in 1990.

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Trump dips his second wife, Marla Maples, after the couple married in a private ceremony in New York in December 1993. The couple divorced in 1999 and had one daughter together, Tiffany.

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Trump putts a golf ball in his New York office in 1998.

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Photos:Donald Trump's rise

An advertisement for the television show "The Apprentice" hangs at Trump Tower in 2004. The show launched in January of that year. In January 2008, the show returned as "Celebrity Apprentice."

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Photos:Donald Trump's rise

A 12-inch talking Trump doll is on display at a toy store in New York in September 2004.

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Photos:Donald Trump's rise

Trump attends a news conference in 2005 that announced the establishment of Trump University. From 2005 until it closed in 2010, Trump University had about 10,000 people sign up for a program that promised success in real estate. Three separate lawsuits -- two class-action suits filed in California and one filed by New York's attorney general -- argued that the program was mired in fraud and deception. Trump's camp rejected the suits' claims as "baseless." And Trump has charged that the New York case against him is politically motivated.

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Trump attends the U.S. Open tennis tournament with his third wife, Melania Knauss-Trump, and their son, Barron, in 2006. Trump and Knauss married in 2005.

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Photos:Donald Trump's rise

Trump wrestles with "Stone Cold" Steve Austin at WrestleMania in 2007. Trump has close ties with the WWE and its CEO, Vince McMahon.

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Photos:Donald Trump's rise

For "The Apprentice," Trump was honored with a star on the Hollywood Walk of Fame in January 2007.

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Photos:Donald Trump's rise

Trump appears on the set of "The Celebrity Apprentice" with two of his children -- Donald Jr. and Ivanka -- in 2009.

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Photos:Donald Trump's rise

Trump poses with Miss Universe contestants in 2011. Trump had been executive producer of the Miss Universe, Miss USA and Miss Teen USA pageants since 1996.

Trump -- flanked by U.S. Sens. Marco Rubio, left, and Ted Cruz -- speaks during a CNN debate in Miami on March 10. Trump dominated the GOP primaries and emerged as the presumptive nominee in May.

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Photos:Donald Trump's rise

The Trump family poses for a photo in New York in April.

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Trump speaks during a campaign event in Evansville, Indiana, on April 28. After Trump won the Indiana primary, his last two competitors dropped out of the GOP race.

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Photos:Donald Trump's rise

Trump delivers a speech at the Republican National Convention in July, accepting the party's nomination for President. "I have had a truly great life in business," he said. "But now, my sole and exclusive mission is to go to work for our country -- to go to work for you. It's time to deliver a victory for the American people."

Trump apologizes in a video, posted to his Twitter account in October, for vulgar and sexually aggressive remarks he made a decade ago regarding women. "I said it, I was wrong and I apologize," Trump said, referring to lewd comments he made during a previously unaired taping of "Access Hollywood." Multiple Republican leaders rescinded their endorsements of Trump after the footage was released.

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Trump walks on stage with his family after he was declared the election winner on November 9. "Ours was not a campaign, but rather, an incredible and great movement," he told his supporters in New York.

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Story highlights

Experts say Trump's plan to have his kids run his business presents real problems

Foreign countries could use Trump properties to pressure or influence the White House, experts say

Washington (CNN)Republican presidential candidate Donald Trump reiterated Thursday that if he wins the presidency he'll have his children run his companies to eliminate any conflicts of interest as commander in chief -- but it turns out, it's not that simple.

Handing the business to his kids will do nothing to minimize the potential for foreign influence on the presidency and would make it possible for the Trump family to gain financially from the highest office in the land, global businesses analysts and former presidential advisers said. Now it's become another line of attack for the campaign of his rival, Democratic candidate Hillary Clinton.

Trump has said that his children will be his business management back-up plan for months now, most recently in a Fox News interview Thursday.

"I will sever my connections and I'll have my children and executives run the company, and I wouldn't discuss it with them," Trump said in reference to a Newsweek magazine article about the potential conflicts of interest caused by Trump's business holdings in India, South Korea, Russia and elsewhere.

However, there are a number of reasons why putting his kids in charge wouldn't address concerns, according to experts. Trump would still know where his family properties are located in the US and overseas, and as president, would be in a position to make decisions on the economy and foreign policy that could benefit his family's fortunes.

And foreign countries might see Trump business ventures in their country as a way to exert pressure or curry favor.

Clinton campaign chairman John Podesta charged that the details in the Newsweek report "paint a frightening and dangerous picture of the influences circling Trump and the Trump organization. Trump's business dealings could effect his judgment."

Podesta noted that few of Trump's foreign interests were disclosed in his filing with the Federal Election Commission and raised the question of transparency -- a weapon both campaigns are trying to deploy against the other.

"There are 54 days to go to election day," Podesta said. "It's simply appalling that we don't know more about the debts and foreign business dealings of the man running to be president," he said in a conference call Thursday.

Trump's "extensive financial dealings overseas with America's allies and enemies pose an unprecedented conflict of interest that could threaten our national security interests and global interests."

The Trump campaign, meanwhile, has been accusing Clinton of conflicts because of the donations her family's charitable foundation receives from international figures.

Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics, said Trump's massive empire meant that a Trump White House will be "a constant drama as to whether his business ventures are benefiting or being harmed by his public policy decisions."

Kenneth Gross, who has advised previous presidential candidates on how to handle their finances, said Trump's handing his business over to his heirs or placing the holdings into a blind trust doesn't work well with physical properties. Generally, these techniques are applied to stock or bond assets that someone else trades for the original investor.

"Putting it into a blind trust doesn't wipe out your knowledge of it. You know it's there," said Gross, now a lawyer at Skadden, Arps, Slate, Meager and Flom.

Trump's Financial Disclosure Report shows the bulk of his business interests are in the US, but he has holdings such as hotels and golf courses in at least 22 countries, including Saudi Arabia, China, Turkey, Panama, Egypt and the United Arab Emirates.

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In an example of how complicated Trump's business holdings are, the candidate paused during remarks about Chinese currency manipulation at the Economic Club in New York Thursday to add a thought -- that he "likes China" because it rents a lot of condos.

Podesta also raised Newsweek's description of Trump's stymied efforts to get more of a toehold in India's market, wondering aloud if Trump's would "come down harder on Pakistan to win favor with the Indian government."

"These are decisions affecting countries with nuclear weapons," Podesta said. "They're serious and they're potentially catastrophic" if influenced by anything other than the concerns for our national security, he said.

Norm Ornstein, a political scientist at the American Enterprise Institute, said that since Trump's international holdings are largely in property and real estate, if he became president, "most foreign policy decisions you would make would have real implications for your holdings and your net worth, which means the conflicts of interests would be piling up beginning with every morning's security briefing."

And other countries could see Trump's business as a means to wield influence. "There would always be the question -- whether they're putting the screws on him in his private life to have him change his policies in his public life," Hufbauer said.

A former ethics lawyer for President George W. Bush said another problem will be the way banks and regulatory agencies in the US deal with Trump family members managing his properties.

"You think the banks are going to turn down the president's son on a leveraged loan?" said Richard Painter, now a corporate law professor at the University of Minnesota.

In Thursday's Fox interview, Trump was also asked how he would handle a situation in which sanctions were imposed on a country where his businesses are located.

"Oh, I would absolutely get out in some form, if its ownership -- would have to sell," Trump said. "I would get out of those countries. I wouldn't be want to be involved."

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Podesta said the fog around Trump's foreign interests mean he must meet three demands. The first would be to disclose those business dealings, a second is that he has to divest from his company if he wins the presidency -- a requirement that would apply to Cabinet members, said Podesta, a former noted.

"Surely the same standard should apply to those seeking the presidency of the United States," he said.

And he called on Trump to release his tax returns so people can have greater clarity on what his business interests actually are. Those deals, he said, raise the question of whether a President Trump would "be basing decisions on the best interests of the United States and national security or would he be basing his decisions on what's good for the Trump organization's bottom line."